Modivcare addressed its recent filings with the U.S. SEC and announced adjusted guidance. On September 12, 2024, the company filed a Form S-3 shelf registration statement with the SEC, as well as a Form 8-K, providing additional information. Once declared effective by the SEC, the Form S-3 will provide the company with flexibility to raise capital as needed over the next three years. The company does not plan to issue equity at this time. The company is focused on seeking near-term covenant relief under its revolving credit facility to address potential delays in contract receivable collections. Advanced discussions with the company’s bank group have been collaborative and supportive. Contract Receivables: Modivcare remains confident in collecting outstanding receivables from its managed care organizations and state payor customers. As previously disclosed, the company has experienced delays in the timely collection of approximately $60M of its outstanding $159.3M in NEMT segment current contract receivables, primarily from MCO customers, as of June 30, 2024. This situation is primarily driven by the impacts of Medicaid redeterminations and the resulting increase in utilization under its shared-risk contracts. The company expects to enter 2025 with aligned prepayment rates and does not anticipate the situation to persist as utilization patterns continue to stabilize.
